Germany's Puma posts sales of $2.25 bn in Q1 FY24

In regional developments, the Americas experienced positive growth for the first time in four quarters, increasing sales by 1 per cent to €790 million. This growth was noted particularly in the US. The Asia-Pacific region also saw a modest increase of 0.6 per cent to €456.6 million, driven by strong performance in Greater China. However, sales in the EMEA region remained flat at €855.7 million, although results in Europe exceeded expectations, the company said in a press release.

Puma's direct-to-consumer (DTC) segment showed robust growth, rising by 13.5 per cent to €494.2 million and increasing its share to 23.5 per cent of total sales. Conversely, the wholesale business declined by 2.9 per cent to €1.6 billion.

In product categories, footwear sales were up by 3.1 per cent thanks to strong demand in football and other performance categories. On the other hand, apparel and accessories faced declines of 2.4 per cent and 3.2 per cent respectively.

The gross profit margin improved significantly, up by 100 basis points to 47.5 per cent, largely due to lower sourcing and freight costs and a favourable product and distribution channel mix, which helped offset the currency-related challenges.

Operating expenses saw a slight decrease of 0.4 per cent to €845.3 million. However, the operating result (EBIT) declined by 9.4 per cent to €159.0 million mainly due to the adverse effects of currency fluctuations on sales, gross profit margin, and OPEX ratio, causing the EBIT margin to drop by 50 basis points to 7.6 per cent.

Financial challenges continued as the financial result decreased significantly to minus €26.8 million, from minus €7.8 million the previous year, impacted by lower gains on forward exchange transactions and higher interest rates. Consequently, net income saw a sharp decline of 25.5 per cent to €87.3 million, with earnings per share dropping to €0.58 from €0.78 in the same quarter last year.

“We delivered our first quarter results fully in line with expectations. While the market continues to be volatile, we delivered growth and gross profit margin improvement despite significant currency headwinds and high prior year comparables. Our retail partners are still working through elevated stock levels, but as our sell-through was higher than our sell-ins, we jointly improved the inventory levels in the wholesale channel. We expect that we will improve sell-in in course of Q2. Our double-digit growth in DTC with fewer discounts confirms the continued strong demand for the brand and thus continued good sell-through,” said Arne Freundt, chief executive officer of Puma.

Fibre2Fashion News Desk (DP)